Who approved the $85 billion US taxpayer bailout of AIG?

[KelleyKramer]

Quoting from this article about the bailout-
http://biz.yahoo.com/ap/080916/aig.html

" ... the U.S. government agreed Tuesday to provide an $85 billion emergency loan to rescue the huge insurer AIG. The Federal Reserve said in a statement it determined that a disorderly failure of AIG could hurt the already delicate financial markets and the economy."

If its taxpayer funded or even backed, then its a US gov't expenditure.

How can the Federal Reserve make this decision on their own??

And even if this included the Sec of Treasury, thats an Exec branch cabinet position.

If I'm not mistaken, all US gov't spending must originate with the elected Congress.

Specifically the US House of Representatives.

I dont see how they can get away with this and hold the US taxpayer responsible to pay for it.

.

[firedupdem]

1. But they can't get water to hurricane victims? I hope people start

to wake up. This country has gone crazy.

[ellaydubya]

2. Whoa & Wow!!!

This is so scary....are we asleep???

[seemslikeadream]

3. Federal Reserve is not the government

[KelleyKramer]

6. "U.S. government agreed Tuesday to provide an $85 billion emergency"

Thats from the beginning of my post.

And yes, I know the Fed is controlled by private banks, but is backed by the US taxpayer.

You need to re-read my post.

[seemslikeadream]

11. I'm sorry I didn't mean it that way

I just repeated it because it was so important, I even recommended your OP

[KelleyKramer]

13. No worries ...

I'm just incredulous that they are able to do this... didnt mean to come across as harsh.

[Ghost Dog]

14. Reuters says Federal Reserve takes over American International Group:

GLOBAL MARKETS-Asia stocks, dlr and oil climb on AIG rescue
Tue Sep 16, 2008 9:43pm EDT

* Treasury yields rise after Fed to take 80 pct stake in AIG

* Crude up $3, yen drops as some risky assets bought back

* Systemic risk curbed for now by Fed prop up of AIG (Repeats to additional subscribers with no change to text)

HONG KONG, Sept 17 (Reuters) - Asia stocks rebounded and oil extended gains to more than $3 a barrel on Wednesday after the Federal Reserve said it would take over American International Group in a dramatic about-face as victims of the financial crisis kept piling up.

The Fed will provide AIG (AIG.N: Quote, Profile, Research, Stock Buzz), once the largest insurer in the world, a bridge loan of $85 billion and take an 80 percent stake in the ailing company, shouldering the U.S. taxpayer with more liabilities following the government takeover of Fannie Mae and Freddie Mac about a week ago.

After reports about the plan surfaced, investors bought back equities and U.S. dollars while selling the government bonds they had accumulated in the wake of Lehman Brothers' (LEH.P: Quote, Profile, Research, Stock Buzz) chapter 11 filing on Monday. However, the stock market rally across the region was still rather tame.

/... http://www.reuters.com/article/marketsNews/idINSP26565820080917?rpc=44

[KelleyKramer]

16. "shouldering the U.S. taxpayer with more liabilities"

Quote from the second graph of the article in your post.

[Ichingcarpenter]

4. FEMA........ they don't need the money

or the effort.

[still_one]

5. This is unbelievable, and in return they give the taxpayers 80% ownership

in a bankrupt company

You are also correct, that Congress is suppossed to approve all spending

but do you really think anything will be done

The only thing I can say, is that if this is done, there better be NO ONE who is against universal healthcare

[Cheney Killed Bambi]

7. Here is the answer

In lending up to $85 billion at a hefty interest rate –- LIBOR plus 8.5 percentage points –- to insurer AIG, the Federal Reserve once again relied on its rarely used legal authority under Section 13(3) of the Federal Reserve Act to lend to “any individual, partnership or corporation” in “unusual and exigent circumstance” provided the borrower “is unable to secure adequate credit accommodations from other banking institutions.”

Read the whole thing for more:

http://blogs.wsj.com/economics/2008/09/16/fed-invokes-unusual-and-exigent-clause-again/

[Barack_America]

8. They put it to an AOL poll.

Not really, but if they had I'm sure the idiots would have voted for it.

[whistle]

9. The bureaucracy

[bobthedrummer]

10. THE DECIDER...

[RB TexLa]

12. Sorry I misunderstood your question.

[orleans]

15. i'm hoping aig doesn't lose it's ass--they send my mom her pension

check every month. (it's not much--but she absolutely needs it)

[KelleyKramer]

17. All the more reason, SS should never be turned over to these bandits

Just think if we had turned over the nations Social Security money to these very same robber barons.

[orleans]

18. i can't even imagine something like that. unfuckingreal.

it would have been the most insane thing--turning over our money to basically a bunch of gamblers.

[obamaforme]

19. I thought Bank of America bailed them out.

[dsc]

20. that was merryl lynch

[specialed]

21. The Federal Reseve Bank

Is a privately owned bank. It's not a government owned institution.